F3 (FA/FFA) – Chapter 9 – PART D – CBE MCQs – ACCA

These are ACCA F3 (FA/FFA) Financial Accounting MCQs for Part-D of the Syllabus “Recording transactions and events”.

These multiple-choice questions (MCQs) are designed to help ACCA F3 students to better understand the exam format. We aim to instill in students the habit of practicing online for their CBE exams. By doing so, students can reduce exam stress and prepare more effectively.

Please note:

  • Students should not attempt these MCQs until they have finished the entire chapter.
  • All questions are compulsory, so please do not skip any.

We hope that these MCQs will be a valuable resource for students preparing for the ACCA F3 (FA/FFA) exam.

INFORMATION ABOUT THESE CBE MCQs Test/Quiz

Course:ACCA – Associations of Chartered Certified Accountants
Fundamental Level:Knowledge, FIA – Foundation in Accounting
Subject:Financial Accounting
Paper:F3 – FA/FFA
Chapter:Intangible non-current assets
Chapter Number:09 of the Practice and Exam Kit
Syllabus Area:D – “Recording transactions and events”
Questions Type:CBE MCQs
Exam Section:Section A

Syllabus Area

These Multiple Choice Questions (MCQs) cover the Syllabus Area Part D of the Syllabus; “Recording transactions and events” of ACCA F3 (FA/FFA) Financial Accounting Module.

Time

These MCQs are not time-bound. Take your time and solve them without stress. Pay proper attention and focus. Do not rush or hesitate

Result

Students will get their F3 CBE MCQs Test results after they finish the entire test. They will also be able to see the correct and incorrect answers, as well as explanations for the incorrect questions.

Types of Questions

MCQs: Choose one from the given options.
Multiple choice: Choose all those answers which seem correct/ or incorrect to you, as per the requirement of the question. Keep your eye on the wording “( select all those which are correct/ or incorrect)“.
Drop-down: Select from the list provided.
Type numbers: Type your answer in numbers as per the requirement of the question.

 

0 votes, 0 avg
37

F3 - Chapter 9 - Part A - MCQs

Course: ACCA - FIA
Subject:
F3 (FA/FFA) Financial Accounting
Syllabus Area: D - Recording transactions and events
Chapter in Kit: 09 - Intangible non-current assets
Exam Section: Section A
Questions type: MCQs
Time: No Time Limit

INSTRUCTIONS

  1. If you are using mobile, turn on the mobile rotation and solve the MCQs on wide screen for better experience.

REQUEST

  1. Please rate the quiz and give us feedback once you completed the quiz.
  2. Share with ACCA students on social media such as, Facebook Groups, Whatsapp, Telegram, etc.

1 / 12

In its first year of trading to 31 July 20X6, Camp Co incurred the following expenditure on research and development, none of which related to the cost of non-current assets: $12,000 on successfully devising processes for converting seaweed into chemicals X, Y and Z and $60,000 on developing a headache pill based on chemical Z. No commercial uses have yet been discovered for chemicals X and Y. Commercial production and sales of the headache pill commenced on 1 April 20X6 and are expected to produce steady profitable income during a 5-year period before being replaced. Adequate resources exist to achieve this.

What is the maximum amount of development costs that must be carried forward at 31 July 20X6 under IAS 38 Intangible Assets?

2 / 12

PF purchased a quota for carbon dioxide emissions for $15,000 on 30 April 20X6 and capitalised it as an intangible asset in its statement of financial position. PF estimates that the quota will have a useful life of three years.

What is the journal entry required to record the amortization of the quota in the accounts for the year ended 30 April 20X9?

3 / 12

Which of the following items (that all generate future economic benefits, and whose costs can be measured reliably), is an intangible non-current asset?

  1. Computer hardware owned by a business
  2. Operating software that operates the computer hardware in (1)
  3. A patent bought by a business
  4. An extension to an office building owned by a business

4 / 12

Which of the following statements about research and development expenditure are TRUE, according to IAS 38 Intangible assets.

5 / 12

Which TWO of the following conditions would preclude any part of the development expenditure to which it relates from being capitalized?

  1. The development is incomplete
  2. The benefits flowing from the completed development are expected to be less than its cost
  3. Funds are unlikely to be available to complete the development
  4. The development is expected to give rise to more than one product

6 / 12

According to IAS 38 Intangible Assets, which of the following statements about research and development expenditure are correct?

  1. If certain conditions are met, an entity may decide to capitalise development expenditure.
  2. Research expenditure, other than capital expenditure on research facilities, must be written off as incurred.
  3. Capitalized development expenditure must be amortized over a period not exceeding 5 years.
  4. Capitalized development expenditure must be disclosed in the statement of financial position under intangible non-current assets.

7 / 12

According to IAS 38 Intangible Assets, which of the following statements concerning the accounting treatment of research and development expenditure are TRUE?

  1. Development costs recognized as an asset must be amortized over a period not exceeding five years.
  2. Research expenditure, other than capital expenditure on research facilities, should be recognized as an expense as incurred.
  3. In deciding whether development expenditure qualifies to be recognized as an asset, it is necessary to consider whether there will be adequate finance available to complete the project.
  4. Development projects must be reviewed at each reporting date, and expenditure on any project no longer qualifying for capitalization must be amortized through the statement of profit or loss and other comprehensive income over a period not exceeding five years.

8 / 12

Theta Co purchased a patent on 31 December 20X3 for $250,000. Theta Co expects to use the patent for ten years, after which it will be valueless.

According to IAS 38 Intangible Assets, what amount will be amortized in Theta Co's statement of profit or loss and other comprehensive income for the year ended 31 December 20X4?

$_______

9 / 12

A manufacturer incurs the following costs: $38,000 developing new techniques that will be put in place shortly to cut production costs; $27,000 researching a new process to improve the quality of the standard product and $8,000 on market research into the commercial viability of a new type of product. It is company policy to capitalize costs whenever permitted by IAS 38 Intangible Assets.

How much should be charged as research and development expenditure in profit or loss? (ignore amortization)

10 / 12

What is the purpose of amortization?

11 / 12

Which of the following CANNOT be recognized as an intangible non-current asset in GHK's statement of financial position at 30 September 20X1?

12 / 12

According to IAS 38 Intangible Assets, which of the following are intangible non-current assets in the financial statements of Iota Co?

  1. A patent for a new glue purchased for $20,000 by Iota Co
  2. Development costs capitalised in accordance with IAS 38
  3. A licence to broadcast a television series, purchased by Iota Co for $150,000
  4. A state of the art factory purchased by Iota Co for $1.5million

Leave a Reply

Your email address will not be published. Required fields are marked *